Distressed Property Solution

Monday, October 4, 2010

How to Avoid a Raw Deal When Buying Raw Land

There are countless things to think of when buying raw land. First thing you should know it is nothing like buying a home. Upon doing a walk-thru of a house, any large issues of concern usually stand out. Things like mold is obvious by an odor and structural concerns are brought out by cracks in the walls inside and outside. Things that may not stand out to the untrained naked eye can be uncovered by a home inspector. However, when buying land the problems that may come there are not always immediately visible and can make for a severe problem later down the road. There are things you can look for and ask about though to lessen the chance of getting a ’raw deal’ on raw land. Perhaps you have dreamed about owning a piece of property, building your dream home and living happily ever after. What many don't consider is that buying raw land can be challenging and should be approached with great diligence and caution.Property Access:The first question you should ask a sell if there is any problem gaining access to the property. It has been know for a piece of land to be "Landlocked". You may see a road leading to the property, but it may not be a legal access documented with an easement.Restrictions:Before you sign any paper work or pay any money, you need to know what you can and cannot do on the property. The local title company can provide with a list of restrictions. Or if you are working with a realtor, they can get the list of restrictions for you. If they have the property listed, they will already know this in advance. Restrictions can be anything from with a minimum size home or no mobile homes allowed.Land Boundaries: If the seller doesn’t provide a property survey, you may be able to negotiate for the Seller to pay for one. Never purchase land without a full survey being done first. Not only will this define the corners or the shape of the property, but it will include the defining midpoints and recording at the local courthouse as well. If the seller is not open to paying for a survey, it may be worth the cost for you to do so yourself.Easements:Easements are almost always permanent, passed down from deed to deed. A previous owner may have granted access across his parcel for the benefit of another parcel, and you will be the new owner of that access. While there are ways to have those easements changed, it will be beneficial for you to know ahead of time what they are in case they would interfere with your future plans for the property. Building Permits:When you find a parcel of land you’re consider call the local permitting office. Let them know the exact address or location of the land you’re looking and what your plans are for the land. Ask them if a building permit will be required. At this time you may find out about the restrictions. You can also inquire what future plans for the other land around yours are, such as a mall or industrial site being planned. Utilities:Getting utilities on a property can be expensive. Unless you have deep pockets and an endless source of money, find out how close the utilities are and what is needed to get them to your land. If there not water and sewage service, an engineering report would be a good investment to determine the size of system you’ll need. So as you can see buying raw land is not that simple. With the many areas to consider, you much do your homework. Your own due diligence will make the difference of this being a great purchase you can enjoy for years or a bad investment full of regrets.